London Buyers See Biggest Mortgage Savings as Prices Dip and Rates Ease

House buyers in London and the South of England are seeing the strongest improvement in affordability, as a combination of easing asking prices and reduced mortgage rates delivers meaningful monthly savings. According to Rightmove, the shift is putting more purchasing power back into the hands of buyers — though affordability pressures remain higher in these regions compared to the rest of the UK.

In London, where average asking prices have dipped 1.1% over the past year, a buyer purchasing at the average asking price could save £181 a month on their mortgage compared to 2024. In the South East, the saving is around £120 per month, and in the South West it’s £106 per month. By contrast, Scottish buyers benefit from far smaller reductions of just £23 a month, as prices there have risen by 2.6%. Across the UK as a whole, the average monthly mortgage payment has fallen by £84 year-on-year, from £1,590 to £1,506. The average asking price for a UK home currently stands at £370,257, supported by a fall in the average two-year fixed mortgage rate from 4.99% to 4.53%. Rightmove’s analysis assumes buyers purchase at the average asking price, using a two-year fixed mortgage, with repayments spread over 30 years.

Rightmove property expert Colleen Babcock explained that increased competition among sellers and higher stamp duty costs have weighed more heavily on London and the South, resulting in softer asking prices. She added: “The result for buyers is improved affordability when combined with lower mortgage rates, and the higher rate of agreed sales compared to last year suggests many are taking advantage.” However, she cautioned that: “It’s still much more expensive to purchase a home in London and the South of England compared to other areas of Great Britain, so affordability is still stretched despite the increase in purchasing power.”